Coinbase is planning a return to India. The U.S.-based crypto exchange stopped operations there in 2023. Now, it is in talks with regulators. Two sources say Coinbase is engaging with the Financial Intelligence Unit (FIU). This agency monitors financial transactions in India. The discussions are private and ongoing.
According to the reports, Binance resumed operations in India last year after registering with the FIU. This set an example for other exchanges. Coinbase now hopes to follow a similar path.
The company first tried to launch in India in 2022. It introduced support for the Unified Payments Interface (UPI). But India’s National Payments Corporation refused to recognize it. Coinbase suspended the service after three days.
CEO Brian Armstrong later said the Reserve Bank of India applied informal pressure. This currency is not illegal in India, but banks avoid working with crypto firms. They fear upsetting the central bank. Coinbase’s return depends on getting regulatory approvals.
Crypto market in India and FIU compliance
The FIU previously ruled that exchanges like Binance and Kraken were operating illegally. Many have since complied with Indian regulations. A Coinbase spokesperson said the company is eager to re-enter India.
They did not provide an update on FIU registration. The company’s expansion is in conformity to its overseas expansion plans. The company’s CFO, Alesia Haas, indicated this in a Goldman Sachs event.
Coinbase CLO Paul Grewal was recently named to the board of the U.S.-India Business Council. He is keen to strengthen financial technology collaboration between the two nations. Grewal said that India is creating a thriving Web3 ecosystem. Startups and developers are making India a hub of blockchain innovation.
Despite the hype, there are issues. India’s government imposed a 30% tax on cryptocurrency profits in 2022. There is also a tax of 1% per transaction. The policies have slowed the growth of the market. The Indian cryptocurrency ecosystem can be given a boost by a revival of Coinbase.
